South East: 97% of region's manufacturers engaged in innovation - but sector still dogged by fears of falling behind

Over nine in ten manufacturers (97%) in the South East are engaged in innovation, according to a new survey published today by EEF, the manufacturers’ organisation, and Vodafone UK. The findings suggest that the region’s manufacturers are keeping pace with peers elsewhere in the UK, but share the same fears about falling behind competitors.

The EEF/Vodafone 2015 Innovation Monitor shows that the main focus for South East manufacturers is on improving their manufacturing processes (97%), closely followed by improving their service (94%). However, more than three quarters of the region’s manufacturers (77%) have innovated around product improvement too.

The innovation does not stop there – 77% have improved their organisational methods and systems, while six in ten (60%) have innovated to improve their marketing or distribution.

The biggest driver for manufacturing innovation is the desire to satisfy existing clients (55%). However, just under half (47%) of the region’s manufacturers have innovated in the last three years to boost margins on existing products and services.

Over a third (37%) say that developing existing domestic markets is the main thrust of their innovation projects, matched by those saying the same of existing export markets (37%). Almost three in ten (29%) have innovated because they are seeking new export markets, while just under a third of the region’s manufacturers (32%) have innovated in the last three years to comply with environmental standards and regulations.

The research shows that, UK-wide, manufacturers are highly ambitious about innovation and are investing heavily in it. But they are finding innovation challenging and a lack of resources is reducing the chances of success.

Jim Davison, South of England region director at EEF, says: "Manufacturers continue to forge ahead into new markets at home and abroad, with investment in innovation playing a starring role. However, innovation is a resource-hungry process and manufacturers are finding that the results they achieve do not always match their ambition. Shortages of expertise, equipment and finance are holding them back.

“Every additional pound invested in developing the products and services of tomorrow can help get the UK closer to its goal of having a more productive economy. This ambition should be matched by Government to ensure the UK continues to compete on the global stage.”

Tim Hancock, head of marketing at Vodafone UK, says: "It’s essential that we create the right environment for continuous innovation in manufacturing, which is the backbone of UK industry.

“It is well recognised that to keep pace with competitors both at home and globally, innovation is an essential ingredient. Improvements in other areas, such as streamlining operations to enhance productivity, maintaining full visibility of a connected supply chain and improving responsiveness can free up valuable resources that can be re-invested in innovation across a variety of areas.”